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Mr Clegg has been trying to broke agreement on a collective abstention in the vote in the hope of preserving unity, although he has publicly stated he would like to vote for the package.

He will address his parliamentary party in the Commons tomorrow in a last-ditch effort to prevent a three-way split, but reports suggested that he has yet to persuade key backbenchers including president Tim Farron and former leaders Charles Kennedy and Sir Menzies Campbell not to side with Labour in the no lobby.

Anger: Increasing student tuition fees has seen violent protests in London, with many accusing the Lib Dems of going back on its promises

Business Secretary Vince Cable has also been increasingly public on his desire to vote in favour of the legislation.

Today former Lib Dem leader Lord Ashdown defended Mr Clegg's handling of the tuition fee increases row as the party faces a crisis of identity.

Speaking on the BBC Radio 4 Today programme, Lord Ashdown insisted the party was hammering out its position and each MP would have to decide whether they could support the measures.

'Although there is a commitment that has been made during the election, there is another agreement we have to stick to which is the coalition agreement,' he said.

'That says at the very least you will abstain on this, vote for it if you can.'

Rallying call: Former Lib Dem leader Lord Ashdown has called on MPs to support Nick Clegg over university tuition fee reform

The peer added: 'I personally think that Nick has handled this with great wisdom and a great deal of courage.'

But he accepted that it would be several years before the Lib Dems saw any benefit from taking an 'unpopular' decision.

'At the moment they (the public) are just not listening,' he said. 'Nick could deliver the Sermon on the Mount, they are just not listening.'

Greg Mulholland, MP for Leeds North West, is pushing for a fourth option of calling off the vote, so a full public consultation on the future of university funding can be carried out.

He told The Guardian: 'It is not in anyone's interests to do this at this stage.

'Sometimes the most courageous thing to do is to admit you need a rethink. The best thing for higher education is not to force this vote through on Thursday.'

Mr Mulholland has tabled an early-day motion in the Commons, but has so far only gained support from fellow Lib Dem John Leech and Green MP Caroline Lucas.

Ministers yesterday tried to shore up support for the university funding package by unveiling £150million of help, which could see fees waived for two years for 18,000 of the poorest students.

Under the National Scholarship Programme, young people eligible for free school meals who secure a place in university will have their first year's fees paid by the state.

Universities which charge more than £6,000 a year in fees will be required to fund these students for a second year.

Mr Clegg's chief political adviser Norman Lamb said that a decision on how the Lib Dems will vote would be announced following tomorrow's meeting.

The North Norfolk MP said that both he and the Deputy Prime Minister want to vote for the university funding reforms, but would respect the collective decision of the parliamentary party.

Mr Lamb told BBC1's Politics Show: 'My very strong preference, as is the case for Nick, is to vote in favour.'

But he added: 'We have clear processes. Nick is very keen that he engages with the parliamentary party. We will make our final decision when the parliamentary party meets.'